BBB Tips: Grandparent Scam on the Rise, Investment Scams

Grandparent Scam on the Rise – Know the Red Flags

Seniors are often a top target for scammers, so it’s important they know how to identify signs of potential scams. Chief among these fraudulent schemes is the “Grandparent Scam,” wherein phone calls or emails attempt to fool seniors into thinking their grandchild (or a loved one) is hurt – or arrested and stranded in a foreign country - and in desperate need of money. The Better Business Bureau of Minnesota and North Dakota (BBB) provides some pointers on how to spot and avoid this scam.

The “Grandparent Scam” has been around since 2008, but there has been a surge recently. Retirees are an attractive target for financial scammers. Schemes like this one play off of people’s emotions and strong desire to help loved ones in need. Scammers impersonate their victims and make up an urgent scenario – “I’ve been arrested,” “I’ve been mugged,” “I’m in the hospital” – and target friends and family with urgent pleas for immediate financial assistance.

The BBB offers the following tips to avoid the Grandparent Scam:

Communicate. People should share travel plans with family members before leaving the state or country.

Share information. Contact information – such as the cellphone number and email address of a travel companion - should be shared in the case of an emergency. Family members should remind students to be cautious when sharing details about travel plans via their social media accounts.

Know the red flags. Typically, the grandparent receives a frantic phone call from a scammer posing as their grandchild. The “grandchild” explains that he or she has gotten into trouble and needs help. In many cases, an alleged car accident is involved or a wrongful arrest for drug possession. The "grandchild" pleads with the grandparents not to tell his or her parents and asks that they wire thousands of dollars for reasons such as posting bail, repairing the car, covering lawyer's fees or even paying hospital bills for a person the grandchild injured in the ‘accident.’   

Ask a personal question, but don’t disclose too much information. If a grandparent receives a call from someone claiming to be their grandchild in distress, the BBB advises that the grandparent not disclose any information before confirming that it really is their grandchild. If a caller says "It's me, Grandma!" don’t respond with a name. Instead, let the caller explain who he or she is. One easy way to confirm their identity is to ask a question that only the grandchild would know: a unique detail of a shared experience or memory. 

For more information you can trust, visit www.bbb.org/us/Consumer-Tips/. 

Protect Yourself from Investment Scams

Before you invest your earnings, it is important to check for scams and verify the credibility of the investment firms you’re considering to handle your portfolio. Asking questions, researching companies, reaching out to local investment firms and advisers, talking to other investors…these are all good ideas. The Better Business Bureau of Minnesota and North Dakota (BBB) and Financial Regulatory Authority (FINRA) remind people it’s essential to take precautions when it comes to all investment opportunities.

Studies show that investment scams are on the rise over the past decade. Baby boomers in particular are more vulnerable to such schemes, as many are now managing their own retirement accounts.  In 2010, state securities regulators initiated more than 1,200 enforcement actions, including criminal complaints and cease-and-desist orders, involving investors ages 50 or older, according to the North American Securities Administrators Association. That was more than double the 506 cases in 2009.

FINRA Investor Education Foundation, specializing in investment fraud, has a plethora of valuable information to help you sort through your next investment decision making. They offer three key strategies you can use if you aren’t certain about a specific investment opportunity:

1.      End the conversation

Practice saying “No”.  Simply tell the person, “I am sorry, I am not interested. Thank you.” Or tell anyone who pressures you, “I never make investing decisions without first consulting my___. I will contact you if I am still interested.” Fill in the blank with whomever you choose – your spouse, child, investment professional, attorney or accountant. Knowing your exit strategy in advance makes it easier to leave the conversation, even if the pressure starts rising.

2.      Turn the tables and ask questions

A legitimate investment professional must be properly licensed, and his or her firm must be registered with the Financial Industry Regulatory Authority (FINRA), the Securities and Exchange Commission (SEC) or a state securities regulator, depending on the type ofbusiness the firm conducts.

3.      Talk to someone first

Be extremely skeptical if the person promoting the deal says, “Don’t tell anyone else about this special deal!” A legitimate investment professional won’t ask you to keep secrets.

 Exercising these three key strategies will help protect you from fraudsters. Remember, the more knowledgeable you are when making investments, the less likely you are to become a victim. When making an investment, there’s no need to rush – take your time and make an informed decision.

For more information on how to protect yourself from investment fraud and other such schemes, visit www.saveandinvest.org or www.bbb.org.  

In an Emergency, When Seconds Count, Know Where to Turn

September is National Preparedness Month and what better time to ensure your family’s emergency readiness than with a month dedicated to your safety.  Knowing what to do before, during and after an emergency is a critical part of being prepared and may make all the difference when the seconds start to count. The Better Business Bureau of Minnesota and North Dakota (BBB) urges all families to take the time to create and discuss disaster plans with their loved ones.

“Families should familiarize themselves with the website of FEMA, the Federal Emergency Management Agency,” recommends Dana Badgerow, President and CEO of the BBB of Minnesota and North Dakota. “It outlines various emergencies which could occur where you live and offers appropriate responses to each one.”

Safety is paramount in an emergency, but basic protective actions – for instance, whether to evacuate or shelter-in-place – can differ depending upon the disaster. There are important differences among potential emergencies that should influence the decisions you make and the actions you take.

Two things every family needs regardless of what disasters may strike are an emergency plan and an emergency kit.

Recommended items for an emergency kit include:

• a gallon of water per person per day for three days,
• a three-day supply of nonperishable food for each family member,
• a flashlight with extra batteries,
• first-aid kit,
• a whistle to signal for help,
• dust masks,
• a wrench or pliers to turn off utilities,
• a power inverter or solar charger for your cell phone.

You may consider including prescriptions (or at the very least a list of prescriptions), infant formula and diapers, pet food and cash. Place copies of important family documents (insurance policies, identification and financial records) in a waterproof, portable container near your escape route. Pencil and paper, paper cups and plates, and plastic utensils are also useful. And if you have kids, pack some games, books or puzzles. Maintaining your kit is also important. You will want to replace stored water and food every six months. Mark the date on containers or cans. 

For an emergency plan, make sure all family members know where to meet and who to contact in the case you get separated. A relative or friend in another area is an ideal emergency contact person. Make sure everyone in the family knows how to send and receive text messages. Consider downloading smartphone apps that provide emergency information.

For more information you can trust, visit www.bbb.org.

Kick off September with Kindness – Encourage Proper Etiquette

A warm smile and a kind gesture can brighten even the gloomiest of days. When working with customers, it’s always important to recognize the integral part of quality service. September is National Courtesy Month and the Better Business Bureau of Minnesota and North Dakota (BBB) is encouraging business owners to recognize the importance of encouraging proper businessetiquette among their employees when it comes to dealing with customers.

The trust that’s established between a customer and a business is not only the foundation for a successful business transaction, but makes for an overall healthy business relationship between the business and the customer. The customer needs to feel that they have been heard and that they have received the full attention of the business.

“First impressions matter,” said Dana Badgerow, President and CEO of the BBB of Minnesota and North Dakota. “As a business owner, the first step to ensuring quality customer service is to provide that same quality service to your own employees. Do you greet your employees with a positive hello? Do you listen to them when they offer feedback? The kindness that you show to your employees will multiply threefold as it quickly trickles down to the level of the customer.”

Here are some helpful BBB tips for business owners and managers:

Lead by example. Employees take their cue from management. Make sure that all senior staffers are aware of the importance of how they treat their employees. Those employees are often the face of the business and positive interactions with management leaders will be reflected in their daily interactions with customers. 

Always greet your customer with a warm welcome. When a customer comes to yourbusiness, make sure to address them by name and offer a friendly welcome. Customers pick up on your attitude and will quickly judge your business accordingly. A warm welcome invites customers to stay awhile and strong rapport encourages them to “not be strangers.”

Go the extra mile. Thank you notes, birthday cards, and personalized coupons are a great way to show your appreciation to your customers. If a customer makes a request for something special, do everything you can to say yes.

Give the customer the benefit of the doubt. Whether it’s online or in person, customers can and will complain at some point during your business’ lifetime. Make sure you know how to handle even the most disgruntled individual. Give your employees guidelines on what to say and how to act. Respond consistently and in a timely manner if the complaint is online. Outsiders will see and appreciate your attempt to resolve issues, even if the disgruntled customer does not.

Seek out feedback. Ask your customers and fellow employees, “How are we doing?” Make an honest effort to assess and address all feedback, and implement the best suggestions. Keeping customers and employees happy is the key to success for any business. Feedback allows for an open dialogue and time to reflect on what needs to be changed.

Reward Success. Bonuses are always appreciated, but a “pat on the back” goes a long way towards keeping your employees motivated and feeling appreciated.

For more business tips you can trust, visit www.bbb.org.

The mission of the Better Business Bureau is to be the leader in building marketplace trust by promoting, through self-regulation, the highest standards of business ethics and conduct, and to instill confidence in responsible businesses through programs of education and action that inform, assist and protect the general public. Our hours of operation are 8 a.m. to 5 p.m. Monday through Friday. Contact the BBB at bbb.org or651-699-1111, toll-free at 1-800-646-6222. Visit our Centennial website at bbbis100.org.